Former President Barack Obama used to say he wasn’t against all wars, just dumb wars. That’s how I feel about tax breaks to boost economic development — some good, some bad, some necessary, other wasteful.

The feeding frenzy over Amazon's second headquarters and the Foxconn project that landed in Wisconsin have thrown a spotlight on the ever-expanding role of tax incentives for economic development.

Michigan's cities like Detroit may be hooked on tax incentives, and certainly no developer would refuse a tax break when offered. But with the cost of incentives escalating rapidly — one new study found the cost of incentives nationally has tripled since 1990 — the potential drawbacks could be rising, too.

Incentives take various forms, often in the form of abatement of future property tax obligations. They can also include outright grants, or forgiveness of other future taxes that a developer would otherwise have to pay when a project is up and running.

Last year, the Michigan Strategic Fund approved tax incentives of about $16 million for the Detroit Pistons planned $107-million practice facility in Detroit. At Little Caesars Arena, public sources covered about $325 million of the nearly $900-million cost.

Businessman Dan Gilbert's Hudson's project is in line to get more than $160 million in incentives for the $900-million project, including sales and income tax abatement for construction activities, 30 years of property taxes, and, for 20 years, up to 50% of future state income taxes generated from the new jobs as well as from the new residents who will live inside the tower.

Tax incentives for Detroit projects like Little Caesars Arena and Gilbert's Hudson's site project remain controversial. The debate hinges on whether the benefits that flow from these projects exceed their cost.

And in considering that, perhaps the key question is whether major projects like Little Caesars Arena or the Hudson's project would happen minus the lucrative tax incentives.

Economists call this the "but-for" debate: Would the project never happen but for the tax breaks? Developers and public officials insist that their projects would remain stillborn but for the incentives. But academics and researchers remain skeptics.

In a new report, Timothy Bartik, an economist with the Upjohn Institute for Employment Research in Kalamazoo, looked at incentives nationally. He estimated that incentives "tip" only about 20% of all projects, meaning that 80% of projects would happen anyway, even without the incentives. (He makes clear he's not speaking about any Michigan projects specifically.)

Since incentives nationally amount to about $45 billion a year in the U.S., that means that "state and local governments thus give away more than $30 billion a year in incentives that create zero jobs."

Economic development officials vehemently disagree with that conclusion. They say that even if incentives do no more than speed up a project by a few years, that could offer significant benefits.

Take Gilbert's Hudson's site project. With a price tag of about $900 million, the still-unnamed building will rank as Detroit's tallest when complete and thousands of people will work, live, and shop there.

Would the project happen minus the incentives? Perhaps. But remember that the Hudson's store closed in 1983, stood empty until imploded in 1998, and served as parking for many years until Gilbert broke ground last December. That's about 35 years from the store's closing until something new got started — an indication of how difficult these projects can prove to be and why incentives may be needed to get them going.

And Detroit's landscape is filled with examples like that. The old Tuller Hotel on Grand Circus Park closed in 1976 and fell to wreckers in 1991 and only now is in line for a new development, decades later. The Packard Plant closed in the 1950s and only today enjoys even the glimmer of a hope of something new happening there.

And numerous other projects did not move forward until public incentives paved the way, like the roughly $200-million restoration of what is now the Westin Book Cadillac. Indeed, one could argue that Michigan should be creating more tax incentives, not fewer, by restoring the state's lost historic preservation tax credit. This credit, abolished in 2011, proved particularly helpful in revitalizing older cities like Detroit that remain dotted with empty historic structures. It let developers take a tax deduction of up to 20% of project costs — a key savings that enabled many deals to happen.

But the skeptics and the critics make good points, too, and advocates for using incentives need to admit certain key facts. Incentives may create an influx of new jobs and residents; but those newcomers also create increased costs of public services for schools, traffic management, police protection, and more. Those extra costs are almost never considered when assessing the net gain or loss of using incentives.

Bartik estimates that "growth-induced spending needs can absorb upwards of 90% of the additional tax revenue" from a project. And while the benefits of incentives tend to show up in the short run — new jobs and the glitter of a ribbon-cutting ceremony that politicians of every stripe appreciate — the cost of providing more public services shows up in the longer run.

Whatever position one takes, certainly we can reform the way tax incentives are handed out to ensure the greatest benefit for all. Bartik and other experts offer several suggestions:

Would the Hudson's site project be happening minus lucrative tax incentives? That's a key question in the debate over the role of incentives in economic development.(Photo: Bedrock)

First, state and local governments ought never take money out of other public services to pay for the incentives, and most importantly should never short education funding. The hit to future incomes by stealing money from schools to pay for tax breaks for new development always produces a long-term net loss, Bartik and others say.

Second, incentives that target "high-multiplier" industries like advanced manufacturing — those that create more spin-off jobs in suppliers or local retail — tend to produce more benefits for society in the long run than more generalized tax breaks handed out to any and all projects.

Third, certain types of assistance, like specialized job training programs, can prove many times more effective in producing net benefits than handing out more general tax breaks.

Fourth, tax incentives tend to be created by a relatively narrow group of players — the staffs of agencies like the Michigan Economic Development Corp. or the Detroit Economic Growth Corp. and boards like the state's many downtown development authorities. Giving other agencies that will potentially be impacted, like school systems or police and fire departments, a voice in the review process could ensure that public services don't suffer.

And finally, legislators could time-limit tax incentives, which often continue for 20 or 30 years. Incentives that expire in five to 10 years would limit the potential impact on other public spending.

As I say, it's time for a fuller debate.

Contact John Gallagher: 313-222-5173 or gallagher@freepress.com. Follow him on Twitter @jgallagherfreep.